Australia’s coal industry outlook ignites dispute

Xinhua News reports the mining operations of China National Coal in Shaanxi Province, the country's coal heartland, were ordered suspended after eight miners were confirmed dead in a colliery flooding on Saturday. Officials said the flooding exposed "serious problems" in the implementation of safety measures and the company would only resume operations after an overhaul. State-owned ChinaCoal is the country's second largest coal producer at 154 million tonnes/year. Due to a paucity of gas and oil China relies on coal for 70% of its energy needs and government analysts expect annual coal demand to reach at least 4 billion metric tons by 2020 even after taking into account unprecedented levels of investment in nuclear, wind, solar, and hydro. Official statistics show the death rate per million metric tons of coal produced stood at 2.63 in 2010.

Kentucky power companies Louisville Gas and Electric and Kentucky Utilities said on Friday new, stricter, federal environmental regulations will force them to retire three older, coal-fired power plants and recoup the $4 billion in EPA compliance costs through future price hikes for customers. A recent industry-sponsored study showed the US coal ash industry could suffer $110bn in lost economic activity and cut 300,000 jobs over the next 20 years under the new rules and between 50,000Mw and 70,000Mw of coal-fired power generation throughout US could be retired. The three Kentucky plants being shut down supplied less than 800Mw of power. One megawatt powers about 1,000 homes.

Euroenews reports that two bodies were found by rescuers who are trying to reach trapped miners in an underground coal mine in south Wales. On Thursday morning, water flooded the hillside colliery near Cilybebyll where seven miners were working. Three miners managed to escape while four remained underground. Divers have been trying to reach the workers but debris in the water is making progress difficult.

Western Australia’s manufacturing sector is losing nearly 150 jobs per day as workers chase high wages in mining.

TSX-V junior Prophecy Coal was trading up 6% by early afternoon on Thursday after jumping 11% earlier in the day on news that the Mongolian government has given the go-ahead for a power plant at the mouth of its Chandgana mine. Prophecy – which also controls a Yukon platinum explorer – has more than 1.4 billion tonnes of surface minable thermal coal resources at Chandgana and its producing mine Ulaan Ovoo for which it recently signed offtake agreements in Russia. There is renewed interest in Mongolian coal assets and earlier this week an Australia-based firm exploring in the fast-growing country was sold for a 800% profit a mere 18 months after its IPO.

Polish stocks are on a tear this week after a top court made a mining-friendly tax ruling. Bloomberg reports that Polish stocks climbed for a second day, with the benchmark index heading for the biggest advance in a week, as coal and copper producers jumped after the Constitutional Tribunal ruling on mining taxes: "The court ruled that mining excavations should not be considered as construction works and should be free of real-estate taxes."

The British Geological Survey (BGS) on Wednesday published the latest list of the 52 elements, minerals and metals most at risk of supply disruption because global production is concentrated in a few countries, many with unstable governments. Surprisingly rare earths used in green technology and defence do not top the list but comes in at number five. Antimony, extracted mainly from stibnite (pictured), widely used for fireproofing is most at risk. The platinum group metals (auto catalysts) hold the second spot while niobium used in touch screens and scanners and tungsten for cutting tools are also at risk of supply disruption as a result of increased competition among the world's growing economies, political instability, resource nationalism, along with events such as strikes and accidents. China is the number one producer of 50% of the 52 chemicals on the list and produces 75% of the world's antimony.

Hanjin Shipping signed a 15-year consecutive voyage contract on Wednesday with Korea Southern Power (Kospo) to provide two capesize vessels for the transportation of soft coal.

Strong interest in the Mongolian resource sector has provided shareholders in Hunnu Coal a 800% gain in only 18 months. Thailand's Banpu announced Tuesday it is taking over the ASX-listed junior for $400 million or $1.80/share – Hunnu went public in February 2010 at 20c. Hunnu may be the first of many firms with Mongolian coal assets to attract bidders with Ivanhoe Mines' SouthGobi and TSX-V junior Prophecy Coal talked about as likely targets and a way in for smaller investors who are not be able to participate in Tavan Tolgoi's $3 billion IPO slated for next year.